We discussed the potential problem of inflation, and soaring interest rate in https://www.welhatchamber.co.uk/fixed-rate-borrowing/
We have now heard back from Lloyds Bank who say
As the scheme provides interest only for 12 months and capital repayment holiday for 6 months, the loans can only be provided on a base rate /variable rate loan at the outset.
After 12 months when the client will begin to pay interest, a discussion will take place to either progress as a variable rate or the client can consider other options i.e. fixed rate
THIS IS IMPORTANT.
The question of will Inflation rear its ugly head again is a matter of WHEN not IF
When it does given the amount of QE, and general printing of money that has gone on recently, it will take off. The readjustment back to real values will be a shock to the markets.
Dont get caught on this one.